Here are the important considerations to note:

On 22 June, the Presidency announced the establishment of Transnet National Ports Authority (TNPA) as an independent subsidiary of Transnet.

President Cyril Ramaphosa said this move was a “major step forward in our reform agenda”.

Government’s efforts to accelerate the implementation of structural economic reforms, are aimed at enabling a strong economic recovery, a faster and more sustainable growth trajectory and job creation. The reforms are in electricity, water, digital communications and transport.

“South Africa’s ports are vital to our trade with the rest of the world and play a crucial role both in our own economy and that of the wider Southern African region. There are therefore massive benefits to be realised from reliable, efficient and competitive ports,” said Ramaphosa.

Ramaphosa said if port services were inefficient and costly or if imports and exports were delayed, the economy suffered.

“In recent years, the performance of our ports has declined in comparison with other ports on the continent and around the world. This has had a significant impact on our exports, rendering South African products less competitive and increasing the cost of goods for every South African. We have set out to reverse this decline in performance and to position our ports as world-class facilities that can enable economic growth,” said Ramaphosa.

Ramaphosa said the weak performance of the ports was the result of structural challenges in the logistics system and operational inefficiencies.

“It is for this reason that we are today announcing the establishment of the Transnet National Ports Authority as an independent subsidiary of Transnet, in line with the National Ports Act of 2005. This will mean the establishment of an independent National Ports Authority as a wholly-owned subsidiary of Transnet, with its own board appointed by the Minister of Public Enterprises,” said Ramaphosa.

The president said the move would bring a clear separation between the roles of the infrastructure owner, TNPA, and the terminal operator, Transnet Port Terminals.

“The functional and legal separation of these roles, which are currently operating divisions of the same company, will enable each to be fulfilled more independently and with greater efficiency. In particular, it will mean that revenues generated by the ports can be invested in port infrastructure, both for the replacement of old equipment and for the upgrading and expansion of our ports,” said Ramaphosa.

TNPA will also be able to make its own investment decisions and ensure that it treats all terminal operators fairly and equally in the interests of port users.

“At the same time, Transnet will remain the sole shareholder of the subsidiary to prevent any negative impact on the group’s balance sheet, and to ensure that the ports authority remains an important part of the Transnet group. This is a significant development because this reform has been delayed for more than fifteen years since the National Ports Act was promulgated,” said Ramaphosa.

Together with the restructuring of Eskom, the latest TNPA announcement forms part of government’s ongoing effort to reposition and transform state-owned enterprises so that they can be profitable, sustainable and competitive and can play a developmental role in our economy.

“This reform will have a direct impact on port users and our export industries. They will benefit from increased efficiency, lower costs and new investment in port infrastructure. The implementation of this measure is a crucial part of Transnet’s broader strategy to revitalise our logistics infrastructure, including by developing strategic partnerships with the private sector to attract new investment and enhance terminal operations,” said Ramaphosa.

Transnet has put in place an ambitious plan to invest R100 billion over the next five years in upgrading its infrastructure across the ports system. Achieving this target will rely on leveraging private capital to shore up the contributions of the state and establish world-class infrastructure at our ports.

“Where the private sector can and should play a role is in partnering with the state to improve terminal operations and to invest in new infrastructure, as is already the case in several of our bulk cargo terminals,” said Ramaphosa.

Excitement is building as the winners of the Exporter of the Year Awards 2021 will be announced in less than two months’ time.

In its 26th year, the Exporter of the Year Awards is hosted annually to acknowledge the achievements of Eastern Cape exporters and service providers in the province.

Despite the disruptions of the year, Exporters Eastern Cape is looking forward to recognising exporters and service providers for all their hard work in overcoming and adjusting to the turbulent times.

Entries for the Awards closed in June, and the judging process is currently underway. When judging this year’s entries, the judges will be focusing on innovative initiatives entrants have put in place during these trying times to manage costs and cash flows, retain employment levels, and their plans to recover to pre-Covid turnover levels.

Winners will be announced in the following categories: Transnet Emerging Exporter Award (new category); SJM Flex Environmental Award; SJM Flex Environmental Practice Award; IDC Job Creation Award; Best Provider of Services to Exporters; Best Exporter: Small Business; Best Exporter: Medium Enterprises; Best Exporter: Corporate Category; and Best Exporter: OEM. The Overall Exporter of the Year for 2021 will be chosen from these category winners.

The awards evening, which takes place on Friday, August 20, promises to be a memorable celebration of exporting excellence in the province. The online event will be a blend of live streaming, awards announcements, and pre-recorded speeches.

It promises to offer the same appreciation of local value, superb entertainment, and attendance prizes that exporters have become accustomed to over the years at the awards evening, and will of course, also include a few exciting surprises.

The online nature of the event brings great value to the sponsors and entrants, since the awards can be viewed globally, showcasing company brands to a wider audience. It also offers a special opportunity for companies to invite local, national, and international colleagues and guests to the online awards evening.

Costs of the tickets will be R250 per person. To book your ticket for Exporters EC Exporter of the Year Awards 2021, contact Exporters EC Branch Coordinator, Suzanne Vermeulen at info@exportersec.co.za.

In 2014, the South African Government launched Operation Phakisa for the Oceans Economy, a national initiative for fast-tracking development in the maritime sector. With Operation Phakisa reaching the end of its first phase of implementation in 2019, additional strategies and plans are now needed to achieve sustainable long-term growth in the sector, according to the South African International Maritime Institute (SAIMI).

Based in Nelson Mandela Bay and hosted at the Ocean Sciences Campus of Nelson Mandela University, SAIMI serves South Africa and the African continent by promoting skills development, education, training and research that supports growth of the Blue Economy.

The Oceans Economy sector definition was revised in 2017 to include “all economic activities closely linked to the oceans resources and/or dependent to some meaningful degree on the ocean”. The Eastern Cape Strategic Roadmap for the Oceans Economy indicated that the total contribution of the country’s oceans economy sector is projected to rise to approximately R208 billion in 2038 from R128 billion in 2018, with the percentage contribution to the total economy rising from 4.5% to 4.8% in 2038. In addition, the Roadmap estimated that the number of jobs, whether created directly, indirectly, or through induced effects, would rise from approximately 518 408 to 833 549.

The Roadmap’s calculations further indicated that Marine Transport and Manufacturing contributed the most to the Oceans Economy, at approximately R16.6 billion, with Transport contributing more than Manufacturing at R8.8 billion against R7.8 billion. The second highest contributor was tourism, at R11.7 billion, followed by marine-related construction at R10.8 billion.

Notably, the Roadmap includes an “Other Ocean Economy” category of activities, and this was projected to reach the highest value among the Oceans Economy industries by 2038, rising from R4 billion in 2018 to R30 billion. This category includes indirect, induced and other factors considered to be both oceans economy sectors and subsectors which were not initially considered in sufficient detail under Operation Phakisa in 2014.  Marine Transport and Manufacturing is expected to remain second highest at R26 billion, with tourism, at a value of R17.5 billion, expected to fall to fourth behind marine-related construction at R17.8 billion. Renewable energy, projected to be the fifth highest contributor, appeared as a notably fast-riser, with a value of just R164 000 in 2018 predicted to increase to R15 billion by 2038.

The Oceans Economy is in addition a significant contributor to South African trade. According to the Maritime Doctrine of the South African Navy, 75% of the country’s trade by value, and 95% by volume, is carried by sea. Products of the Oceans Economy further contribute to the value of exports. Two notable categories are Fish, Crustaceans, Molluscs and Other Aquatic Invertebrates, and Ships, Boats and Floating Structures. Trade statistics of the Department of Trade, Industry and Competition (the dtic) indicate 2020 export values of R6.5 billion and 2.87 billion for these categories respectively.

Within Marine Manufacturing, the Operation Phakisa focus area most closely aligned to exports of Ships, Boats and Floating Structures, boatbuilding has become a prominent activity, with a 2020 survey by the dtic finding that 79% of the leisure boat builders were orientated towards export markets. According to the department’s statistics, this industry segment achieved the feat of growing exports in the category Yachts and Vessels for Pleasure or Sports – notably high-value leisure products – in 2020, despite the Covid-19 Pandemic. The South African boatbuilding industry is well-organised, with its industry association, the South African Boat Builders Export Council (SABBEX), representing 68 builders, distributors and component suppliers.

It is important to note that the figures referred to above on the achievements of the Blue Economy relate to either current performance or projections based on existing trajectories. However, based on the country’s location, situated on a major trade route and surrounded mainly by ocean, it can be argued that even higher performance should be possible.

MEDIA RELEASE: SAIMI (South African International Maritime Institute)

Attention: business owners/ leaders/ CEOs/ branch managers

To inform and advance Nelson Mandela Bay’s economic recovery, it is important to continue to monitor and mitigate the negative impacts associated with lockdown and COVID-19 on our local business activity.

By completing this 5-minute survey, you will help local economic development stakeholders to have an up-to-date assessment of the impact of COVID-19 on businesses within Nelson Mandela Bay.

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Multi-stakeholder research team co-ordinated by the:

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Tel:         041 503 7561

E-mail:   investments2@mandelametro.gov.za